Sustainable Finance Lab

INTEGRATING FINANCIAL INSIGHT INTO DECISION-MAKING AND ADVANCING IDEAS TO FOSTER MORE CAPITAL INVESTMENT INTO THE ENERGY TRANSITION

REGULATOR DECLINES TO “BLESS” CERTIFIED NATURAL GAS GIVEN VARYING STANDARDS

Large Surplus Remains in EU Emissions Allowances

SUSTAINABILITY-LINKED DEBT FINDS NEW GROUND

NEARLY $2 BILLION PURSUES CARBON REMOVAL IN THE LAST MONTH

APPARENT SOFTNESS IN INVESTOR ESG DEMAND IN 1Q22

Cumulative investment in the tens of Trillions of dollars will be required to decarbonize the global economy. There is broad understanding that public capital can only provide a very small portion of such investment. The public sector needs to create vibrant enabling environments for private investment, and there is also ample room for the private sector to act on its own.

The Payne Institute brings vast experience from the financial industry, academia and the public sector. Through the Sustainable Finance Lab, we seek to collaborate across all three areas to bring a deeper and actionable understanding of the opportunities for financing sustainable energy and the energy transition. We will also advance ideas related to spurring investment, encompassing financial products, the roles of investors, markets, policy and regulation.

PAYNE FINANCIAL FLOW

Snapshots of trends and financial tools in the energy transition

  • Regulator Declines to “Bless” Certified Natural Gas Given Varying Standards
  • Large Surplus Remains in EU Emissions Allowances
  • Sustainability-Linked Debt Finds New Ground
  • Nearly $2 Billion Pursues Carbon Removal in the Last Month
  • Apparent Softness in Investor ESG Demand in 1Q22 
  • Latest IPCC Report Short Shrifts Finance’s Potential
  • U.S. Hydrocarbon Emissions Certification Expands
  • SEC Climate Disclosure Rules; Tooling Investors to Promote Change
  • Financing the EU’s Weaning From Russia Fossil Fuels
  • Framing the Differences Between Green Finance and Energy Transition Finance

Decarbonizing the oil refining industry: A systematic review of sociotechnical systems, technological innovations, and policy options 2/17/2022

Decarbonizing the oil refining industry: A systematic review of sociotechnical systems, technological innovations, and policy options

Payne Institute Fellow Steve Griffiths, Benjamin K. Sovacool, Jinsoo Kim, Payne Institute Director Morgan Bazilian, and Joao M. Uratani write about how the oil refining industry, which was established in the mid-19th century, has become a foundation of modern society. While the refining of crude oil to produce transportation fuels, petrochemical feedstocks and a variety of other products has brought manifold benefits, it has also led to the global proliferation of greenhouse gas emissions as well as local air pollution from the combustion of fossil fuels. February 17, 2022.

 

 

Payne Institute’s Latest Initiative – Sustainable Finance Lab 2/10/2022

Payne Institute’s Latest Initiative – Sustainable Finance Lab

The Payne Institute is pleased to introduce our latest initiative, the Sustainable Finance Lab (SFL).  The SFL will seek to promote ideas to mobilize more capital investment in the Energy Transition.  Under the direction of long-time Wall Street research analyst Brad Handler, the SFL will focus initially on encouraging the retirement of carbon emitting assets and on the potential of carbon offset markets. It will also support various Payne/School of Mines initiatives, including CCUS and critical minerals.  In addition, the SFL will be a reference resource. In a section on the SFL web page called Payne Financial Flow, we will frequently post on climate finance topics and metrics. To kick off, you will find comments on ESG debt raise in 2021 and the latest voluntary carbon market size statistics.  February 10, 2022.

How private capital can be leveraged to fight climate change 2/8/2022

How private capital can be leveraged to fight climate change

Payne Institute Research Associate Brad Handler and Director Morgan Bazilian write about how the recent UN COP26 climate negotiations once again revealed how the richest nations in the world are not meeting their commitments to the developing world. This was perhaps most powerfully symbolized by OECD countries failing to provide $100 billion a year in capital as promised. Yet, a vastly more important shortcoming of public climate finance is its continued failure to attract the private capital that increasingly appreciates the long-term imperative of climate action and that will be essential if the world is to spend the trillions necessary to fight climate change.  February 8, 2022.

Crediting emissions saved in plugging oil and gas wells 1/26/2022

Crediting emissions saved in plugging oil and gas wells

Payne Institute Research Associate Brad Handler and Director Morgan Bazilian write about how avoided emissions could be credited as carbon offsets and sold on exchanges. Funds totalling $21bn have been allocated in the US’ recently passed Infrastructure Investment and Jobs Act to clean up former industrial and energy sites, including properly retiring some of the estimated 2mn of unplugged abandoned oil and gas (O&G) wells in the US. Those funds can be stretched further if the avoided methane is credited as carbon offsets and sold on carbon exchanges.  January 26, 2022.  

Colorado oil and gas wells are constantly changing hands. Some risk becoming costly “orphans” along the way 1/19/2022

Colorado oil and gas wells are constantly changing hands. Some risk becoming costly “orphans” along the way

Payne Institute Research Associate Brad Handler contributes to this article about how since 2017, more than 42,000 oil and gas properties have been bought or sold in Colorado. If they fall into the wrong hands, they risk ending up abandoned, leaving the state on the hook for cleanup.  Along the way there have been negotiations, a promised $1 million to the community, protests and lawsuits. In whose hands those wells and pipelines end up will determine if they are well run or turn into nuisances and environmental problems, and also whether they are properly plugged and abandoned when they no longer produce. January 19, 2022.

Phasing out coal plants worldwide won’t be easy. These four approaches could help 12/2/2021

Phasing out coal plants worldwide won’t be easy. These four approaches could help

Payne Institute Researcher Brad Handler, Katie Auth, and Director Morgan D. Bazilian write about how reducing coal use around the world is critical for decreasing air pollution and addressing climate change, yet global coal consumption continues to grow in some regions. At the recent U.N. climate negotiations, countries agreed to “phase down” coal use, but achieving these goals won’t be easy, or cheap — and that’s where innovative financing comes in. Our research suggests that getting the right financial structures in place can help countries bring the dirtiest forms of power offline faster and accelerate new clean energy deployment.  December 2, 2021.

A faster, fairer way to retire carbon-emitting assets 9/1/2021

A faster, fairer way to retire carbon-emitting assets

Payne Institute Senior Fellow Brad Handler and Director Morgan Bazilian write about how carbon retirement portfolios are a potential solution to the problem of retiring CO2-emitting assets.  They can benefit sellers, buyers and governments, while accelerating cuts in emissions.  This article describes how they could work – and five areas for stakeholders to consider.  September 1, 2021.

Exploring Carbon Retirement Portfolios 7/30/2021

Exploring Carbon Retirement Portfolios

Payne Institute Fellow Brad Handler and Morgan Bazilian write a commentary on there are new financial instruments that are being designed and brought into the fight against climate change. One such potential instrument is a Carbon Retirement Portfolio (CRP), a collection of carbon-emitting assets, including oil & gas (O&G) producing wells and coal-fired power plants (coal plants). A CRP would buy these assets with the commitment to retire them more quickly than their business-as-usual case. Thus, CRPs can be a vehicle to accelerate a country or region’s reduction of its greenhouse gas (GHG) emissions.  July 30, 2021. 

5 ways to boost clean energy investment in developing economies 6/29/2021

5 ways to boost clean energy investment in developing economies

Payne Institute Fellow Bradley Handler, Director Morgan Bazilian, and Michael Hayes write about how for emerging and developing economies to meet their energy development and net-zero climate goals, tens of trillions of dollars in investment will be required. This is significantly more than can be expected to be raised from public funds alone, and thus private capital must provide the difference. Yet there remain many obstacles to the deployment of private capital in clean energy projects in emerging economies, as they can impose additional risk and cost and thus dampen investor interest.  June 29, 2021.  

Leadership


Brad Handler

Payne Institute Program Manager,
Sustainable Finance Lab, and Researcher
1600 Jackson Street, Suite 370
bhandler@mines.edu